Rogers Business Solutions is engaging in the international telecom market through its carrier and wholesale alliances, partnerships and agreements – plans for world domination are not required


Michael Cheong: Looking to partner with the right international carriers

 
 


Terry Canning: Important to have partners with similar customers
 
 
As an operator with a significant base of consumer and business customers in its home market of Canada, Rogers is taking a different approach to its wholesale operations. Unlike many operators, which are focusing primarily on expanding their international operations so they can support the international growth of their customers, Rogers is looking for partners with similar operations to partner with in foreign markets. The company believes that it’s not necessary to own overseas assets to achieve international coverage and instead, is assembling a roster of trusted partners that have similar customer profiles and capabilities to its own.

Much as in the airline industry in which national airlines have banded together to form co-operative partnerships and alliances such as the Star Alliance or OneWorld, to enable code-sharing on longhaul routes and other cost savings, Rogers envisages assembling a global network of operator partners to bring their organic, domestic traffic to its Canadian network while simultaneously, having them serve its Canadian customers in their own home markets.

“We don’t have aspirations of expanding globally, but we’re making sure that our growing outbound organic traffic be terminated properly,” says Michael P. Cheong, vice president and general manager of Carrier Alliances and Wholesale Services at Rogers Business Solutions. “We’re looking to partner with the right international carriers so they terminate our voice and data traffic with the right quality and, in return, we want these same carriers to bring us their voice and data traffic to terminate for them within Canada. It’s what we would call a ‘co-creation’ strategy. This is a more collaborative arrangement - much like a strategic partnership where carriers can leverage investments already made in ‘partner networks’ to expand their own service reach or even look to share costs of greenfield opportunities. In this scenario, capex efficiencies are the main benefits. You can leverage each other’s fixed assets already deployed and accelerate business plans.”

There’s certainly enough traffic at stake to make Rogers an attractive partner. Rogers is Canada’s largest provider of wireless voice and data communication services, and one of the country’s leading providers of cable television, high-speed internet and telephony services. Rogers Business Solutions provides voice and data services to businesses and enterprises of all sizes in both the public and private sectors, as well as on a wholesale basis to domestic and international carriers. Most recently, it won the rights to be the carrier of choice for the largest broadcasting company in Canada.

The scale of the Canadian market itself should not be underestimated. Cheong points out that Canada is the fifth largest generator of outbound international traffic in the world and, as the country welcomes a growing number of immigrants from Asia, Latin America and Africa, that trend is set to continue even more. Add to that the increasingly globalised nature of commerce, and it is clear that traffic growth is set to continue.

As a consequence, Rogers Business Solutions is positioning itself as the Canadian gateway to the rest of the world. With its robust fibre network extending into the US, the company has recently activated a point of presence (PoP) in Miami to provide access to the Caribbean and Latin America. A further PoP has also already gone live in London to bolster the company’s access into the European market and its newest PoPs in Hong Kong, Singapore and Los Angeles, will open up the Asian market. It is anticipated that given the strong cultural ties between Canada and the Far East, these will be particularly lucrative assets.

These assets form the foundation of the Rogers international business, and the rest will be completed through a series of carrier alliances and partnerships with carefully selected operators. “Our focus is on quality routes and network compatibility with our organic business,” explains Cheong. “Our traffic now is primarily voice, but soon to be data – so, we are looking for partners with very good networks and performance and provided the cost structure is good, we will partner. We’re searching for carriers that have the urgency to transform their voice to IP; we steer away from carriers that desperately try to hang on to legacy TDM capability as they are often too dominated by an engineering culture.”

Cheong is looking for long lasting relationships and, while that might seem counter to the flexible propositions other wholesale providers may be offering, it makes greater sense when you consider the reciprocal nature of partnerships that Rogers has in mind. “So, for us, we have new subscribers come on board everyday and new businesses needing connectivity - all driving bandwidth rich applications and a need to communicate globally. Available and reliable connectivity is not an option anymore – it’s an expectation. So, for us carriers, we have the wonderful challenge of meeting the needs of these new opportunities to grow in the most efficient manner. The old ‘do more with less’ is our reality. We need to be okay with ‘we can’t do it all on our own’. It is that pursuit of a successful business model for us that pushes us to look for carriers that want to establish relationships for the long term and ensure the relationship isn’t moved around.”

However, much of the wholesale market is a moving target. The business is in transformation and finding suitable partners that have the attributes of stability, strong domestic customer bases, a strategic focus on IP and similar service portfolios and strategies to Rogers Business Solutions is far from straightforward. “Over the last two years, we’ve seen movement among the large carriers towards the same line of thinking as us,” says Cheong, “and as a result, we’re starting to see the elimination of ‘middle-man’ carrier-brokers as the large carriers get together to discuss future business models, driven by the rapid technology changes.”

Differentiation when it comes to wholesale capacity is a complex challenge faced across the market, but Cheong thinks Rogers has much more to offer today and in the future. “In terms of how we differentiate our value proposition, let’s not forget that the DNA of Rogers comes from its Cable roots – so, in North-America, we have the benefit of being part of the Cableco family and we have the ability to mesh our network with other MSOs - as opposed to the legacy telco networks, we can offer a cable core network all the time.”
Customer requirements are certainly changing and, while the bulk of wholesale traffic is voice today, the role of data traffic is becoming markedly more important – especially in Canada. The demands placed on wholesale providers are therefore greater and more complex, and Rogers is positioning itself now to serve the future demands of its customer base through its Connected Life initiatives.

“It’s an on-going challenge, but we are building towards the future,” says Terry Canning, senior vice president of Rogers Network Services. “That’s why we’re adamant in building long term relationships so we can slowly build our business with our carrier partners. By selecting the best partners, the underlying assumption is that they are more capable in their markets just as we are more capable in Canada. The idea is to build confidently and to build up our strengths and address our customer and partners’ customers’ requirements as they emerge.”

For Canning, that data opportunity is starting to emerge. “The timing for this is good,” he says. “Users are only now expanding into data networks and we’re positioned to go out of Canada with some of our big Canadian enterprise and MNC customers. It is important to have partners with similar customers. That’s why, when we choose partners, we ensure our organic customer bases are as similar as possible.”

That, in addition to Rogers’ commitment to future wireless services, results in a natural limitation on which partners Rogers Business Solutions can select. “A lot of our future international activity – both inbound and outbound is tied to us being a wireless company,” adds Canning. “We’re ready for the [enterprise] evolution to SIP as well as the existing demand for high quality end-to-end calls. Inevitably that shortens the list of people we can partner with. We see wireless in Canada as being pretty explosive. The technology is only just emerging and we definitely want to be out in the front. Wireless is headed to the extreme depths of where the internet is today – an area in which Rogers went ahead of everyone in Canada, thus being in the leader position today.”

That emphasis on innovation while pursuing what some would call a conservative mode of international expansion, may seem something of a paradox but it echoes the spirit of the company’s founder, Ted Rogers, and is tightly targeted to the company’s core strengths in high quality service-oriented innovation. Rogers Business Solutions has based its international approach on providing IP and Ethernet technologies that are secure, flexible, scalable and reliable. It is also an active participating member of the i3 Forum, the Metro Ethernet Forum and CableLabs.

“We’re driven to build to an all-IP network – the foundation of any successful carrier business model in the future,” says Cheong. “A lot of carriers are promoting to be doing that, but we actually are. Our active participation and learnings we get from the i3 Forum, the MEF and CableLabs allow us to do so with purpose and confidence. Becoming all-IP is key for us and we’ve set aside the required capital and human resources to make this happen sooner rather than later – we are very aware that Canada, while probably right in line with the US, lags behind UK, Europe and Asia. We are working through this evolution to becoming all-IP systematically as it’d be a mistake to think that all IP implementations are the same. The international carrier partners that Rogers is looking for, will need to demonstrate their commitment to making the same journey.” GTB